Earlier this month, a little two-person humor web site in Austin, Texas took one of the world’s dominant internet businesses to federal court. Lamebook is not the most elevated of web sites. A compendium of user-submitted screen shots taken from a certain well-known social network, Lamebook promises visitors “the funniest and lamest of Facebook.” The payoff comes in page after page of reproduced wall posts and comments replete with double entendres, LOLs, and declarations of “FAIL.”

According to Lamebook’s legal complaint, Facebook lawyers sent a standard “cease and desist” letter demanding that the site stop using any names or graphics similar to Facebook’s. Trademark attorneys write these letters at the drop of a hat, and the usual response is capitulation. Most of the time, fighting back isn’t worth the headache and cost, even where there is a really good argument against liability. It’s worked for Facebook in the past: the location service TripTrace abandoned its earlier name of “Placebook” after receiving such a letter.

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Lamebook lawyered up instead. The site is now represented by a firm with a pugnacious New Yorker’s name on the door, Bracewell & Giuliani. After some back-and-forth with Facebook—the two sides dispute how much negotiation occurred—Lamebook launched a preemptive strike. Rather than waiting for Facebook to sue, Lamebook filed the first complaint, seeking a declaratory judgment in Texas federal court that Lamebook does not infringe Facebook’s trademarks. (A few days later, Facebook did sue in California, and now there probably will be some procedural wrangling to see which case moves forward.)

Lamebook’s main argument: free speech principles protect its right to parody Facebook. While there isn’t a clear parody immunity in trademark law, Lamebook can point to some good precedent. Back when Spy Magazine was around, for example, it published its version of a Cliffs Notes “study aid” analyzing novels by Tama Janowitz, Bret Easton Ellis, and Jay McInerney. When Spy was sued, the court found a protected “double parody,” contrasting the “flat, straightforward, academic style” of Cliffs Notes to a genre of “savvy, urban novels depicting the drug abuse, promiscuity, and post-adolescent angst of the 1980s.”

More recently, a small business called “Haute Diggity Dog” won the right to continue making its handbag-shaped “Chewy Vuitton” dog toys after winning a federal case against the Paris fashion retailer. The court there, perhaps overexplaining the joke a tad, declared the toys “a joking and amusing parody. The furry little ‘Chewy Vuiton’ imitation, as something to be chewed by a dog, pokes fun at the elegance and expensiveness of a LOUIS VUITTON handbag, which must not be chewed by a dog.” And the photographer whose “Food Chain Barbie” works “portray a nude Barbie in danger of being attacked by vintage household appliances” also prevailed.

Not H. L. Mencken, perhaps. But if brand owners can stop this kind of mockery, we have a serious problem. Fortunately, the law probably favors the folks at Lamebook—as long as they can survive the grueling obstacle course of federal litigation.

To be sure, the site focuses on the individual “funny and lame” postings featured there. Sometimes we are laughing along with their authors (funny), and sometimes at them (lame). But the joke wouldn’t be as good if it didn’t refer to Facebook too. It works partly because it refracts the image Facebook creates of our collective zeitgeist.

Without some lenience for parody, comment and so-called “nominative use,” it would become impossible even to refer to an iconic brand without using its name, thus infringing on trademark rights. Fortunately, when faced with these disputes, most courts now realize their role as protectors of speech. And even Facebook doesn’t even try to stop use of the company’s trademark in a newspaper story about the company, or go after sites that track it (or, for that matter, in the highly fictionalized and rather negative account of its founding in The Social Network.)

But it’s still problematic that Facebook gets to selectively harass commentary that uses its name—fighting Lamebook, but ignoring blogs like AllFacebook and Inside Facebook. Even if parody ultimately wins in court, it’s so expensive to litigate that big trademark owners can outlast their critics. That’s why Lamebook fighting back is so significant.

For those skeptical of the affirmative case for parody rights, Lamebook also has a negative argument. Most trademark rights are predicated on proving a “likelihood of confusion” among consumers. There isn’t such a likelihood here. Overall, Lamebook bears only a passing resemblance to Facebook. The humor site’s name is similar, of course, and its logo apes Facebook’s characteristic color scheme, font, and thumbs-up icon to indicate when you “like” something (turned downward, of course, in the Lamebook version). But the remaining layout and graphic features are quite different

Moreover, most users will notice quickly that they are laughing at anonymized strangers—names and faces are blurred on Lamebook “to protect the guilty” —rather than interacting with their own friends. The site functions more like a blog, with comments, ratings and categories (including “Douchebags/Douchbagettes” and “TypOHs!”). It’s hard to imagine how anyone could even land on the page thinking it was Facebook, but in the unlikely event, a few seconds should clear up any lingering user confusion.

Certainly this is not the classic trademark case of old, where the second comer imitated a trademark in the hopes of fooling customers and stealing them away. It isn’t even like “Placebook,” which had neither connection to or comment about Facebook and which could not have chosen such a similar name by accident. So if nobody gets tricked into going to Lamebook to share their photos and status updates, what’s the harm?

Facebook argues that Lamebook is guilty of free-riding. It calls Lamebook “an improper attempt to build a brand that trades off Facebook’s popularity and fame.” But not all free-riding is bad, at least for consumers, and not all is confusing. Intellectual property is a monopoly granted because it creates societal benefits, not a premium for creating a successful brand—that’s its own generous reward.

Swayed by these arguments, however, some courts recently became more aggressive about which similarities might confuse consumers. One line of cases recognizes something called “initial interest confusion,” which penalizes uses of trademarks if a viewer might wrongly believe there was a connection to the trademark owner for even a few seconds, and even if the mistake is quickly dispelled.

Such sweeping trademark rights become untenable as our remix culture expands into a retweet culture. In this roiling stew of cross-references and comments, confusion about associations becomes less harmful and less likely, not more.

Finally, there’s this: the best way for Facebook to insure that people visit Lamebook is to continue this lawsuit. According to data from Alexa, traffic to Lamebook went up 82 percent in the week after the lawsuit filing. When Goliath attacks David, David garners attention.

At the same time, Lamebook actually contributes to awareness of Facebook and its giant status. Unlike Second Life, which once sent a joking “proceed and permit” letter to a parody site, Facebook is not easily amused. Smart companies realize that, when they start making fun of your brand, it proves you’ve made it. Facebook, with half a billion active users and a central place in our daily life, can afford to let us laugh at them.

Bill McGeveran is a law professor at the University of Minnesota and brother of Capital co-founder Tom McGeveran.